Brazzil

Lucky Brazil to Have Such a Competent Helmsman Amid Global Financial Tempest

The article is highly informative full of rich details and figures. We are indeed lucky to have such a "Competent Helmsman" to guide us through this turbulent period. I would like to complement the writer Dick Hayes for writing this thought provoking article.

At the same time, I would like to admonish the Editors for publishing the wrong picture of the true "Competent Helmsman".

1)positive trade balance.
It is shrinking quite fast and the trade balance is not as important as the current account, since the trade balance is include in the current account.
It also happens that the Current Account is actually at a HISTORICAL RECORD.....DEFICIT !!!!!!

2)Credit has become SOMEWHAT restricted and more expensive.
OHHH YESSSSSS...FOR THE SOMEWHAT :
35 % cars, 60 % for consumers goods, 230 % for overdrafts !!!!!

3) Most companies, however, concentrate on their core businesses and have avoided excessive risk taking, as have the banks.

But...but....more is to come. Everyone knows that. Estimates are for the time being at US$ 27 B.
As to banks, rumor is UNIBANCO has trading losses ! First bank in a serie to be revealed.....later !

4)Those that export are receiving more reais for their dollars than two months ago so that helps to compensate.

True ? Look at Cia Vale stock price.
And Mato Grosso Farmers who just stopped paying their INTERESTS !!!!!!!

5)Fewer Brazilians are affected by declining share prices than is the case in the US !

MAY BE ! WHAT ABOUT THE PENSION FUNDS ?

6)Second mortgages do not exist here so people have not used their homes as ATMs.

Questions to Joao :
What are the mortgage rates ?
What are the DOWN PAYMENTS NEEDED ?

when equity and commodity market bottom out and revert to fundamentals.

Were oil & grains & metals prices at the fundamentals...when they were
at the highest ? smiles

What a junkie Hayes is ! Not surpising he is free lance ! Meaning nearly jobless. Who would hire him ?????

smiles

ch.c,

your venerable swiss banks are currently in deep pooh, pooh & 1 step away from insolvency. some of your venerable swiss cos. such as nestle, abb, novartis, etc. count brazil in their top 3 global markets - so w/o brazil, their sales #s w/n be so venerable.

so i'm not sure what point you are trying to make by constantly being negative......some of your comments are insightful, but most of the rest have a sour grapes flavor to them.

given your diligent participation in this blog with comments on every article, it appears that you are probably unemployed or unemployable. how else would anybody have the time to engage in what you do.

i am neither swiss nor brazilian, however have visited both countries & if given a choice, would choose to live in brazil vs. switzerland. the food is much tastier, the people are nicer, the climate is better, the beaches are fantastic, etc. etc. btw, the private health care system in brazil is comparable to switzerland - yes i'm sure this sounds shocking to your wax plugged ears!

Now that the Wall Street crash has made it pretty clear that the corn-based alcohol program is a dead end in the USA.

Does that help Brazil with its cane-based program, or not? Will the USA import alcohol or just write it off?

A slightly different perspective . . .
[Report this comment]
Posted by: charles000 on Feb 21, 2009 2:55 PM on Alternet

For years I have worked at that seemingly mysterious intersection of technology development, venture financing, and economic policy. In such context, at times, I analyze data and hear discussions not commonly seen by the "outside world".

This is what I come away with at this juncture, and have sensed is the reality that until recently was a reasonably well disguised iceberg, lurking below the waves of the now very stormy economic oceans we are supposedly attempting to navigate through.

About a decade ago, [1998] I gave a presentation at Duke, and later at various venues on the concept of "virtual commodity assets" becoming the defacto valuation platform against which all future trading indices, including currencies which themselves are a traded commodity, would be based.

The "dot com" debacle was a sort of momentary glimpse into this theoretical universe that had ALREADY become the well established, but "unpublished" reality of the global trading and currency grid systems.

What I found rather interesting at that particular event was that about half of the audience at the time (various faculty and industry analysts) were in complete denial, or simply did not want to see the obvious . . . but the other half not only were on the same page, but thought my presentation at the time was "too gentle" of a description of such phenomena.

But this is the real point, that was told to me in the strongest language possible - the public cannot be included in this "inner realm" of analysis, as the panic of realization and reaction thereof would itself become the process dynamic that would collapse the entire system.

In other words, even then, the system itself was already, in essence, a fantasy, a shell game of virtual commodities and valuation indices that had no real grounding in anything except the theoretical formulae that had been invented to create these "virtual commodity assets".

The implied intrinsic valuation was not based on the system itself, but on the psychology of perception of value in the system.

I cannot stress this strongly enough.

And I reiterate, this was a closed event filled with some of the best intellects of academia and international economic systems theory to be found anywhere, which included a number of theoreticians who had already been long engaged in their hedge funds, derivatives trading, and so on.

This was a chilling indicator of the differences between the psychology of public perception, and actual system health.

This hollow house of cards has been a spectacular theater act for many years, and certainly this was not unknown to many who played at this level in the game.

My sense of the past ten years is that various insider elements in the transnational banking consortia knew, with certainty, that this "global Ponzi scheme" would eventually come to an end in its current form, and their plan was to position themselves as the new power elite coming out of this now occurring perfect storm of engineered economic chaos, as a strategic long term eventstream with "acceptable" collateral damage to large segments of the US and global populations.

PBS can't report this - no one can.

To do so would cause even more damage than what is already apparent, at an accelerated pace that would spiral completely out of control, and complete exposure of this macro system architecture as described will be blocked, by whatever means necessary.

And that's the key here - this is engineered economic chaos strategic objective, and the theory is to manage the apparent chaos within pre-determined parameters.

This is what I believe is the reality, as the evidence I have personally witnessed would strongly suggest such to be the case.

The reality is, there is no "there" there.